Impact of Heuristics on Investors’ Investment Personality

In the present speculative market conditions, most of the investors struggle to make a correct decision. The investment decisions of investors are influenced by many factors. One such factor is heuristics, which affects their successful investment decisions. Heuristic biases make the investors to be emotionally unstable, less cognitive and intuitive decision maker. This study has taken heuristic bias factors to find out whether the heuristics of investors determine their investment personality or not. For this purpose, multistage random sampling technique is adopted to gather the data from retail investors who are accessing the equity market from the Tamil Nadu region. The congregated data are analyzed quantitatively by using the statistical tools of factor analysis, discriminant analysis and structural equation model. The findings of this study suggest that heuristics play a key role in determining the investment personality of investors.